Boeing Bond Analysis - 3021 Words

Boeing Bond Analysis Presented to Dr. ----- Prepared by Filipe Ferro October 9, 2012 Table of Contents Boeing Company 3 Bond Issue 3 Unsystematic Risk 4 Principal Repayment 4 Debt to Invested Capital 4 Debt to Equity 4 Current amp; Quick Ratios 5 Interest Repayment 5 Times Interest Earned 5 Credit Position 6 Competitor Analysis 6 General Dynamics 6 Northrop Grumman 7 Systematic Risk 7 Market Responsiveness 7 Duration 8 Modified Duration 9 Accuracy of Rating 9 Interest Rate Expectations 9 Summary 10 Appendix 11 Descriptive Statistics 11 Regression Analysis 11 Duration amp; Modified Duration 12 References 13 Boeing Company Boeing is a manufacturer of aircrafts and national defense†¦show more content†¦If bankruptcy occurs, debentures will be the last of debt holders to get paid. Although it is not exactly good to have this somewhat high ratio, knowing that Boeing has a brand new and appealing aircraft reassures that positive future cash flows will cover this financial leverage. Samp;P’s NetAdvantage highlights the potential sales to emerging airlines from China and airlines with old worn out planes in the U.S. and Europe. Samp;P’s industry survey states â€Å"China, India, the Middle East, Eastern Europe, and Latin America, will drive growth in global air travel and demand for new aircraft.†4 The market for aircraft purchases looks like it will grow in the coming years, thus Boeing will have greater opportunities for sales. Current amp; Quick Ratios The current assets to current liabilities ratio was 1.22 for the 4th quarter of 2011, which means every $1 in current liabilities is covered by $1.22 in current assets. Boeing has enough current assets to pay off all its current liabilities if it needed to do so. The current ratio has been 0.9 for 2007, 0.8 for 2008, 1.1 for 2009, and 1.1 for 2010. The current ratio has been on an upward trend since 2008 which would imply added financial security in forecasts. But the current ratio assumes that a company’s current assets are highlyShow MoreRelatedBoeing Case Study1744 Words   |  7 PagesThe Boeing Company is an international aerospace and defense corporation originally founded by William E. Boeing in Seattle, Washington. The international corporate headquarters are now located in Chicago, Illinois (Boeing, 2009). Boeing was initially incorporated as Pacific Aero Products Company in 1916 (Boeing, 2009). Since 1916, Pacific Aero Products Company has transformed into Boeing and expanded into the largest global aircraft manufacturer by revenue, orders and deliveries, and the secondRead MoreCase Study of Boeings Decision to Develop the 7771299 Words   |  6 Pagesrate of return against which to evaluate the prospective IRRs from the Boeing 777? 1a. which beta did you use? Why? 1b. if you used the CAPM, which risk premium and risk free rate did you use? Why? 1c. which capital-structure weights did you use? Why? Answer: i. Key Assumptions for the Calculation: In order to calculate the appropriate rate of return against which to evaluate the prospective cash flows from the Boeing 777 project, several assumptions had to be made. First, in order to facilitateRead MoreThe Boeing 7e71250 Words   |  5 PagesThe Boeing 7E7 WACC Estimation In order to evaluate the prospective IRRs from the Boeing 7E7, we first try to estimate an appropriate required rate of return for accepting this project. The capital asset pricing model is applied to estimate the cost of equity of the commercial aircraft division: R_EC= ÃŽ ²_EC*(R_M-R_f )+R_f where REC is the cost of equity capital of the commercial aircraft division. ÃŽ ²EC is the beta for the commercial division of Boeing. This beta is used instead of the company’sRead MoreBoeings Strategy1485 Words   |  6 PagesRf = Risk free rate of return, usually U.S. treasury bonds ( ) ÃŽ ² = Beta for a company E(Rm) = Expected return of the market (commercial airlines market) E(Rm)-Rf = Sometimes referred to as the risk premium The beta and risk-free rate should be selected as required according to the Boeing 7E7 case study. For the CAPM the risk free rate of return for a given period is taken to be the return on government bonds over the period. The risk free rate of return at theRead MoreSituational Analysis, Airbus1448 Words   |  6 PagesSituational Analysis, Airbus. Porter’s Five Forces. Risk of Entry by Potential Competitors – The aviation industry is a very difficult industry to enter, and the risky of entry by potential competitors is extremely low. Rivalry among established companies – The intensity of rivalry among established companies within the aviation industry is very high. 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Assuming that the required rate of return is 15% and the initial cost of the machine is $3,000,000. 1. What is the project’s IRR? (10 pts) Using this online IRR Calculation Tool http://finance.thinkanddone.com/online-i†¦ we get the followingRead MoreBoeing : The Boeing Company Essay1654 Words   |  7 Pages The Boeing Company (NYSE:BA) was founded July 15th, 1916. Boeing is one of the world’s largest producers of aircraft and aerospace systems, producing both commercial jets and defense, as well as space and security systems. Boeing’s operations are extensive and widespread, and can be located throughout more than 150 countries around the world. Boeing’s products are highly diversified and cater to all sectors within the aviation industry. Some of Boeing’s original products were the result of contractsRead MoreCase Studies in Finance: Estimating the Cost of Capital2017 Words   |  9 Pagesusually U.S. treasury bonds ÃŽ ² = Beta for a company E = Expected return of the market (commercial airlines market) (E - Rf) = Sometimes referred to as the risk premium The following table shows the average annual arithmetic returns investors earned on various asset classes over the period 1900 to 2003. (Source: Table 7.1 in Brealey/Myers/Allen) | Nominal Return | Real Return | Common Stocks | 11.7 | 8.5 | Long- term Government Bonds | 5.2 | 2.3 | Short-term

Health, Safety, And Welfare - 1515 Words

Health, safety, and welfare is of paramount concern in all assessments as without this the learner is at an unfair disadvantage. To counteract this I’m proactive at promoting and enforcing safeguarding procedures. I have a duty and responsibility to provide a service to my learners and staff that protects them from harm. The ‘Safeguarding Vulnerable Groups Act 2006†² asks Assessors to protect those under 18 and all vulnerable adults (those in community care, with mental or other disability, age, or illness and who is unable to protect him or herself against significant harm or exploitation) e.g. Young mothers or anyone who needs help in society Making sure my learners and staff feel safe is my duty of care as an training centre so I make sure to apply 6 elements of appropriate service provision in all my assessing; respect, dignity, independence, individuality, choice, and confidentiality. 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Andrea Yates Paper free essay sample

Andrea Yates drowned her five children in a bathtub in her home. This was very disturbing news. I am a native Houstonian. I was at home that day. The television was on and will never forget the news breaking announcements that broke the story of a homicide in Clear Lake. All the information the reporters had was a mother killed all her children then called the police to report it. The full story and the details that lead to this tragedy did not unfold until years later. It was sad because as details unfolded if Andrea Yates had been treated properly and followed her doctors recommendations the whole situation might have been avoided. Andrea Yates had a history of mental illness in her family. It has been written that her father, a brother and a sister have suffered from depression. Andrea also has another brother that has been diagnosed with a bipolar personality disorder. With this type of history of mental illness in her family it really is not a shocking revelation that Andrea would develop a mental illness. Andrea Yates’s first display of mental illness was just after the birth of her first child in February of 1994. She stated after her arrest that she had â€Å"visions† of someone being stabbed with a knife. She was said to have been suffering from post partum depression in 1999 when she was admitted to the psychiatric unit of The Methodist Hospital after a failed suicide attempt. While in the psychiatric unit Andrea Yates was found to have been non-verbal and severely depressed. There are times that she would take her medications and then she would refuse to take them a day later. She was prescribed medications like Zoloft and Zyprexa. Andrea attended group therapy sessions during her stay there and was said to have days that displayed some slight improvement and then she would revert to her nonverbal state. Eventually she was released but it was noted by her doctor that she was still depressed but not suicidal. While at home, Andrea’s mental state did not appear to improve. She stays in bed all day, begins self mutilating, scratching bald spots on her head, and scraping her legs and arms. She discloses to her husband, Rusty, that she having hallucinations. For their own reasons, the Yates couple does not discuss the hallucinations with Andrea’s doctors during outpatient or inpatient treatments. Andrea was also experiencing other symptoms of schizophrenia. These symptoms include her belief that that there are cameras in her home watching her and that television cartoon characters are communicating with directly to her. She became anti social with an array of other symptoms that included flat affect, poverty of speech and loss of directedness. Andrea and Rusty Yates were warned about continuing to have children. They were told it would not be a good situation for Andrea to become pregnant because her post partum depression would worsen and might include a worsened state of psychosis. The couple did not listen to the warnings of the doctors and they continue to have children. Andrea’s condition only worsened with each pregnancy as she still continued to go on and off her medications. Her mental state continued to deteriorate, to make matter worse for Andrea she experienced the loss of the father. Andrea was already in a frail state of mind, she had said that she felt that she was a failure as a mother. In her mind killing her children would guarantee that their souls would go to heaven. So rather than risk them going down the wrong path in life, she saved her children (in her mind) by drowning them in the bathtub of their home. The Andrea Yates court case was very interesting because it brought to light the details of a how Andrea got to the state of mind she was in. It let people in to her world. We got to hear how her life had changed after the birth of her first child. How her marriage was not a source of comfort but a source of pressure and stress. She was under a lot of stress to be an obedient wife to her husband and a good mother that home schooled her children while leading them down the path of righteousness. Her mental health was treated but I don’t feel that anyone appreciated the severity of her illness. Rusty Yates even admitted that on the witness stand. Her first trial verdict was guilty. This occurred in the month of March of 2002. She was not given the death penalty but sentenced to life in prison. Honestly, I felt this was not what she deserved. She was being punished for been a suicidal depressed schizophrenic who was never able to fully benefit from treatment. I remember thinking wouldn’t it be punishment enough for her to have to wake up one day with a clear mind and realize what happened. How can one possibly stay sane or get proper treatment incarcerated? Forward a few years to 2006. With a very prominent legal team working on her behalf, Andrea gets what seems to be a miracle. After her murder conviction was thrown out due to erroneous testimony Andrea Yates was once again was standing trail for the murders of her children. Andrea and her family were forced again to relive the situations and details that lead up to that fatal morning in 2001. The trail was different for this time she was found not guilty by reason of insanity. This meant that she would not have to back to a prison but instead be sent to a state maximum security hospital where she will remain until she is determined not to be a danger to herself or others. Once she has made enough progress and improvement, she can then be moved to another mental health facility in the state. While there is nothing in the world that would bring back the Yates children, I feel Andrea Yates got the justice she ultimately deserved. She was not the average hardened criminal but a loving, religious wife and mother who just happen to fall victim to a mental illness in which she had no control over. This case was a very instrumental because it helped bring to light that mental illness like post partum depression should not be taken lightly. The victims of mental illness aren’t just going to â€Å"snap out of it† one day. They need to seek treatment and help because ignoring an issue like mental illness might result in a tragedy that could have been avoided.